Stitch Fix set to raise $120M from downsized IPO

Stitch Fix revised where it would price its IPO lower last night ahead of trading, and it looks like it helped approach the right sweet spot as a result when it made its debut today.

There's been plenty of appetite for Stitch Fix's upcoming NASDAQ listing, but concern around disappointing listings from Snap and Blue Apron may explain why the fashion e-commerce company has opted to slim down its IPO tomorrow.

That price comes in below the original guidance range of $18-$20 while the company is now selling eight million shares as opposed to 10 million. Stitch Fix could, however, raise as much as $18 million more if underwriters buy the full allotment of 1.2 million shares allocated to them.

The company will join the Nasdaq Friday November 17, where it will trade until "SFIX."

All told, Stitch Fix will be valued around $1.2 billion when it makes its public debut. That's a big leap on its last financing round in 2014 when it was worth $309.31 million, according to data from PitchBook, but it could have been higher based on those previous estimates.

TechCrunch reported in July that the company had filed confidentially to go public. Stitch Fix is part of a wave of try-before-you-buy startups like Le Tote, MM.LaFleur, as well as others. So, naturally, it’s an area that’s going to be competitive — the most obvious one being Amazon. The company is experimenting with its recent launch of Prime Wardrobe, and the company is well known for bulldozing into segments where it sees an opportunity.

The Stitch Fix business has progressed with promise. It has a run rate of close to $1 billion counting the year between July 30, 2016, and July 30, 2017, according to previous documents. Revenue growth has been impressive, and the company can boast positive net income, too.